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Contractors are nearing full capacity due to labour shortages, according to the first Build UK state of trade survey.

Three quarters of respondents said they are operating at 75% capacity, with 43% operating at over 90% capacity.

The survey - which covered the fourth quarter of 2015 - reported that labour shortages are a cause of these capacity issues with professional and technical employees and supervisors identified as 鈥渄ifficult鈥� to find.

Skilled workers such as bricklayers and steel fixers were also amongst the most difficult to recruit for respondents with 62% reporting a low number of applicants with the required skills being an issue.

A further 54% said a lack of experienced applicants was an issue in recruiting, while 48% said there was a lack of required qualifications.

The difficulty in finding staff has also impacted on labour costs with 45% of respondents reporting an increase compared to the previous quarter and 60% reporting rises over the last year.

16% of respondents blamed late completion of work on labour shortages while 12% said they had been unable to bid for work in the last quarter.

Build UK chief executive Suzannah Nichol MBE said: 鈥淲hilst we continue to see growth in construction, the market is very mixed and difficulties in recruiting the right skills and the knock-on effect on labour costs are causing very real concerns.鈥�

Build UK launched last summer through the merger of trade associations the UKCG and the NSCC.

Payment is also an issue for contractors with 46% of respondents to the survey reporting an average wait for payment between 46 and 60 days and 36% citing it as a cause of contract dispute in the last quarter.

However, contractors remain positive for the next year with 56% of respondents expecting growth.